business & regulatory drivers for multi-emissions legislation business & regulatory drivers...
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Business & Regulatory Drivers for Multi-Emissions Legislation
Business & Regulatory Drivers for Multi-Emissions Legislation
Customers:
3.3 Million Electric1.8 Million Gas
Customers:
3.3 Million Electric1.8 Million Gas
4th largest US electricand gas utility —
4th largest US electricand gas utility —
Public Service Company of
Colorado
Northern States Power Company-
Wisconsin
Northern States Power Company-
Minnesota
Southwestern Public Service
Unemployment rate —November 2004
US 5.2%Xcel service area 4.1%
Job growth – 2005 ForecastXcel service area 2.4%
Xcel Annual sales growth —2005-2009
Electric 2.0%Gas 1.2%
Unemployment rate —November 2004
US 5.2%Xcel service area 4.1%
Job growth – 2005 ForecastXcel service area 2.4%
Xcel Annual sales growth —2005-2009
Electric 2.0%Gas 1.2%
Strong Regional Economy
Strong Regional Economy
Energy Supply Mix — 2004Owned and Purchased
Energy Supply Mix — 2004Owned and Purchased
Owned Generation
68%
Owned Generation
68%
Gas21%Gas21%
Other11%
Other11%
Purchased Energy
Purchased Energy
Nuclear12%
Nuclear12%
Coal *54%
Coal *54%
Gas27%Gas27%
Renewable7%
Renewable7%
Fuel MixFuel Mix
* Low-sulfur, low-mercury western coal* Low-sulfur, low-mercury western coal
Xcel EnergyXcel EnergySupply Requirement and CapabilitySupply Requirement and Capability
20
21
22
23
24
25
26
27
Current capabilitybased on existing generation
and contracted purchases
Current capabilitybased on existing generation
and contracted purchases
2004 2014201320122011201020092008200720062005
Thousands of MWThousands of MW
Resource need without Resource need without renewal of expiringrenewal of expiringpurchase contractspurchase contracts
Supply requirementSupply requirement
Xcel EnergyXcel EnergySupply Requirement and CapabilitySupply Requirement and Capability
20
21
22
23
24
25
26
27
Current capabilitybased on existing generation
and contracted purchases
Current capabilitybased on existing generation
and contracted purchases
2004 2014201320122011201020092008200720062005
Thousands of MWThousands of MW
Resource need without Resource need without renewal of expiringrenewal of expiringpurchase contractspurchase contracts
With approved additions
Supply requirementSupply requirement
Environmental InitiativesEnvironmental Initiatives
Reduce and manage energy consumption
Reduce our environmental impact
Increase use of renewable energies
Advocate public policies that achieve environmental improvement, regulatory certainty and cost effective energy
Protect wildlife
Reduce and manage energy consumption
Reduce our environmental impact
Increase use of renewable energies
Advocate public policies that achieve environmental improvement, regulatory certainty and cost effective energy
Protect wildlife
Reduce and Manage Energy ConsumptionReduce and Manage Energy ConsumptionReduce and Manage Energy ConsumptionReduce and Manage Energy Consumption
Spent more than $65 million on electric and gas demand-side management programs across its service territories in 2004
Expenditures alone resultedin 340 GWh and 663,000 MCFin first-year energy savings
Various conservation andDSM programs have beenin operation for more than15 years
Spent more than $65 million on electric and gas demand-side management programs across its service territories in 2004
Expenditures alone resultedin 340 GWh and 663,000 MCFin first-year energy savings
Various conservation andDSM programs have beenin operation for more than15 years
Promote use of high efficiency products including lighting by offering cash rebates
Provide “online energy assessment”
Provide energy efficient design assistance to architects and engineers
Offer rebates to commercial and industrial customers for boiler maintenance and equipment improvements
Control 360,000 residential air conditioners to reduce peak demand
Control 972 MW of interruptible commercial and industrial load
Promote use of high efficiency products including lighting by offering cash rebates
Provide “online energy assessment”
Provide energy efficient design assistance to architects and engineers
Offer rebates to commercial and industrial customers for boiler maintenance and equipment improvements
Control 360,000 residential air conditioners to reduce peak demand
Control 972 MW of interruptible commercial and industrial load
Voluntary Denver Metro Voluntary Denver Metro Emission Reduction Program Emission Reduction Program
Voluntary Denver Metro Voluntary Denver Metro Emission Reduction Program Emission Reduction Program
Flexibility and incentive result in economical projects with greater environmental improvement
Flexibility and incentive result in economical projects with greater environmental improvement
Valmont
I-70
I-25 I-76
CherokeeUS 36
6,181 1,236 20,964 6,502
7,807 2,747
I-25
Arapahoe6,377 2,455
Uncontrolled NOX
Controlled NOX
2003 ProjectedTons per Year
Uncontrolled SO2
Controlled SO2
Convert two in-city coal plants to natural gas & refurbish a third in-city coal plant
Improves environment
Convert two in-city coal plants to natural gas & refurbish a third in-city coal plant
Improves environment
Voluntary Minnesota Metro Voluntary Minnesota Metro Emissions Reduction ProgramEmissions Reduction Program
Voluntary Minnesota Metro Voluntary Minnesota Metro Emissions Reduction ProgramEmissions Reduction Program
SO2 NOx Mercury ParticulateCO2
SO2 NOx Mercury ParticulateCO2
93% 91% 78% 55%21%
93% 91% 78% 55%21%
Hydro 1,885 MWWind 884 MWBiomass 95 MWSolar 40 KW Total 2,864 MW
Hydro 1,885 MWWind 884 MWBiomass 95 MWSolar 40 KW Total 2,864 MW
TypeType Capacity Capacity *
* Owned and purchased** Nameplate rating* Owned and purchased** Nameplate rating
Renewable Energy SourcesRenewable Energy SourcesRenewable Energy SourcesRenewable Energy Sources
> 12% of 2004 System Capacity> 12% of 2004 System Capacity> 12% of 2004 System Capacity> 12% of 2004 System Capacity
**
0
500
1000
1500
2000
2500
1997 1998 1999 2000 2001 2002 2003 2004 2005 **
ActualActualProjectedProjected
Commitment to Wind PowerCommitment to Wind PowerCommitment to Wind PowerCommitment to Wind Power
2525
MWMW
138138316316 348348
469469 478478
829829 884884
15961596
22062206
**** Timing dependent on renewal of Production Tax CreditTiming dependent on renewal of Production Tax Credit
Reduce Environmental ImpactReduce Environmental Impact
7% reduction in CO2 intensity (pounds per MWh) from 2003to 2012
12 million ton reduction in CO2 emissions by 2009, based on 2003 emissions
7% reduction in CO2 intensity (pounds per MWh) from 2003to 2012
12 million ton reduction in CO2 emissions by 2009, based on 2003 emissions
GoalsGoals
Industry-leading voluntary emission reduction projects
Triple wind generation
Participate in three carbon sequestration programs
Relicense nuclear generation
Implement Minnesota MERP
Industry-leading voluntary emission reduction projects
Triple wind generation
Participate in three carbon sequestration programs
Relicense nuclear generation
Implement Minnesota MERP
ActionsActions
Carbon Management PlanCarbon Management Plan
Burn low-sulfur, low-mercury coal
Baghouses help capture mercury and are currently in-place on most units
Continue testing sorbent technologies at existing facilities
Comanche 3 will be equipped with state-of-the-art technology
Burn low-sulfur, low-mercury coal
Baghouses help capture mercury and are currently in-place on most units
Continue testing sorbent technologies at existing facilities
Comanche 3 will be equipped with state-of-the-art technology
Mercury Management InitiativesMercury Management Initiatives
Reduce Environmental ImpactReduce Environmental Impact
Protect WildlifeProtect Wildlife
By 1989, the Company began installing nest boxes on its power plant chimneys to rebuild peregrine falcon population. By 1999, the peregrine was taken off the endangered species list.
In 2002, Xcel Energy was thefirst electric utility to voluntarily approach the US Fish and Wildlife Service to jointly develop a plan to protect eagles, large raptors and migrating birds from electrocution.
By 1989, the Company began installing nest boxes on its power plant chimneys to rebuild peregrine falcon population. By 1999, the peregrine was taken off the endangered species list.
In 2002, Xcel Energy was thefirst electric utility to voluntarily approach the US Fish and Wildlife Service to jointly develop a plan to protect eagles, large raptors and migrating birds from electrocution.
Environmental AdvocacyEnvironmental Advocacy
Advocate for voluntary emission reduction legislation that supports recovery of investments that reduce emissions below current regulations
Support Clear Skies Legislation
Xcel Foundation will provide additional funding to:— Minnesota Renewable
Development Fund— Colorado Renewable Energy Trust
Advocate for voluntary emission reduction legislation that supports recovery of investments that reduce emissions below current regulations
Support Clear Skies Legislation
Xcel Foundation will provide additional funding to:— Minnesota Renewable
Development Fund— Colorado Renewable Energy Trust
Environmental InitiativesEnvironmental InitiativesEnvironmental InitiativesEnvironmental Initiatives
Owned Generation (GWh)Owned Generation (GWh)Owned Generation (GWh)Owned Generation (GWh) Pounds per MWhPounds per MWhPounds per MWhPounds per MWh
62,000
66,000
70,000
74,000
78,000
82,000
86,000
1997 1998 1999 2000 2001 2002 2003
3.0
4.0
5.0
6.0
Nitrogen Oxide emissionsNitrogen Oxide emissionsNitrogen Oxide emissionsNitrogen Oxide emissionsSulfur Dioxide emissionsSulfur Dioxide emissionsSulfur Dioxide emissionsSulfur Dioxide emissions
Owned generation (GWh)Owned generation (GWh)Owned generation (GWh)Owned generation (GWh)
0
2
4
6
8
10
12
14
16
18
0
2
4
6
8
10
12
14
16
18
Retail Electric RateRetail Electric Rate ** Comparison ComparisonRetail Electric RateRetail Electric Rate ** Comparison Comparison
** EEI typical bills – Summer 2004 EEI typical bills – Summer 2004** EEI typical bills – Summer 2004 EEI typical bills – Summer 2004Cents per KWhCents per KWhCents per KWhCents per KWh
Amarillo
Amarillo
Amarillo
Amarillo
Kansas City
Kansas City
Kansas City
Kansas City
Denver
Denver
Denver
Denver
Mpls/St. Paul
Mpls/St. Paul
Mpls/St. Paul
Mpls/St. Paul
Boston
Boston
Boston
Boston
Des Moines
Des Moines
Des Moines
Des Moines
Chicago
Chicago
Chicago
Chicago
Milwaukee
Milwaukee
Milwaukee
Milwaukee
Phoenix
Phoenix
Phoenix
Phoenix
Salt Lake C
ity
Salt Lake City
Salt Lake C
ity
Salt Lake City
4.874.874.874.876.066.066.066.066.016.016.016.01
St. Louis
St. Louis
St. Louis
St. Louis
MiamiMiami
MiamiMiami
New York
New York
New York
New York
Shifting the ParadigmShifting the Paradigm
InvestorsInvestors
RegulatorsRegulators
EnvironmentalistsEnvironmentalists
CustomersCustomersUtility
InvestorsInvestors
RegulatorsRegulators
EnvironmentalistsEnvironmentalists
CustomersCustomers
Xcel EnergyXcel Energy
Acid Rain Cap & Trade ProgramAcid Rain Cap & Trade ProgramAcid Rain Cap & Trade ProgramAcid Rain Cap & Trade Program
Near-perfect compliance – over 99%
Early reductions – averaged 25% below allowable levels early in the program
Cost savings– cost 75% less than projected
Innovation– generators looked for new, low-cost ways to reduce emissions
Support – accepted among environmental organizations and industry
Near-perfect compliance – over 99%
Early reductions – averaged 25% below allowable levels early in the program
Cost savings– cost 75% less than projected
Innovation– generators looked for new, low-cost ways to reduce emissions
Support – accepted among environmental organizations and industry
Key Components of Key Components of Multi-Emissions LegislationMulti-Emissions Legislation
Key Components of Key Components of Multi-Emissions LegislationMulti-Emissions Legislation
Certainty
Meaningful Reductions
Proven Regulatory Program
Updates Clean Air Act
Cost Effective
For these reasons, Xcel Energy supports the Clear Skies Act legislation.
Certainty
Meaningful Reductions
Proven Regulatory Program
Updates Clean Air Act
Cost Effective
For these reasons, Xcel Energy supports the Clear Skies Act legislation.
Thank You